Income tax , in one form or other, has been the part of system since time immemorial. Mainstay of government's expenditure has always been income tax. No government can survive without income tax. But times have changed. The world is aware that India is poised to become world's leading economy in a decade or so, leaving China behind it. We all talk of India again becoming सोने की चिड़िया. Most of PM's initiative are working in that direction.
Had PM been the only centre of power in the country, his strategies would have galloped India towards the status of leading economy. But federal system of government and 'clerical' bureaucracy are retarding India's march. Civil Servants seldom use their super intelligence and super power for the benefit of public / country. What I am proposing here , should have been proposed by bureaucrats.
PM's thrust on start-ups made me sit up and think so as to accelerate PM's great vision for my beloved country. An economic activity grows in an environment of motivation. What is the greatest motivation for an entrepreneur ? Zero income tax which will boost the business activity in the entire country to unimaginable heights. It will be unparalleled in the whole modern world. No one can contest my idea. Earning of more and more white money should be encouraged by all means. On the contrary, income tax discourages economic activity which is against PM's vision. Thus Income Tax must be abandoned for ever.
The income tax should be replaced by expenditure tax, commensurately. Every citizen of country must have a PAN card and almost every expenditure of every citizen must be through PAN card, duly taxed. The revenue thus collected through expenditure tax must be equal to or more than the revenue collected by Income tax.
When GOI impose / increase income tax, it acts like a deterrent on business including undeclared income, only due to thoughtlessness of bureaucrats. But when income tax is abolished and expenditure tax replaces it, on one hand it will give unprecedented boost to business and on the other hand intelligently crafted expenditure tax will not only boost revenues of GOI but will also become an effective tool to control INFLATION.
Is it not a win win situation for everyone including my beloved India ?
By Mr.Rajiv Chaturvedi [email@example.com]